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EU is Desperate for Extension of Transition. UK Broadcasters silent.

The EU Coronavirus bailout plan will involve 750 billion euros split between 500 bn euros of grants and 250 bn of loans. (See Euractiv).

This huge bailout package is occurring as the UK drastically reduces its EU contributions to the relatively small amount needed to pay pensions etc.  The EU will lose almost a sixth of its income (omitting residual UK contributions).

The EU is hoping that Barnier and the EU negotiating team can pull off a coup and persuade the UK to extend transition for at least two years.  The free money from the UK will subsidise the EU bailout package.  The Remain media in the UK are backing the EU position, seemingly keen that money which should be used for UK bailouts is spent in foreign countries.

The reason that the EU wants the UK contributions is that every £10bn of cash income can be leveraged into £500bn of loans at 2%.  If the British allow the transition to be extended they will remove £500bn from expenditure in the UK and transfer this to foreign bailouts in EU countries.

Barnier has written a letter to all of the opposition parties in all parts of the UK offering a two year transition in the hope that they will attack the UK Government.  This "divide and rule" approach of the EU to UK internal politics is unacceptable.  Had the Russians done the same the UK opposition parties would have been reviled as traitors.  Fortunately for opposition leaders UK broadcasters have covered this up.

The EU bailout package involves increasing the contributions to the EU from member states.  At present member states pay an average of 1.2% of GNI and this will be increased to 2%.

Were the UK to rejoin the EU its contributions might rise from a gross contribution of about £17.4 bn to £29 bn (See House of Commons Library).  It is unlikely that there would be any rebates were the UK to rejoin.  The Brexit bus would have a truthful £557 million a week gross on its side.

According to the Euractiv article the various grants and loans will come with tight conditions to increase EU integration and control in Member States. The EU is a one way street to a single EU State.

31/5/2020

We must not lose sight of the fact that the EU-UK Trade negotiations are in bad faith and have been designed to punish the UK from the outset. It is only by having a clean break that the UK will get good terms in subsequent negotiations.

Comments

Nithya said…
I hope the bailout plan announced by the EU helps to manage the current economic crisis due to the Covid-19 spread. Last week I took part in the open debate session organized by Top IAS coaching centres in Chennai, and we discussed the internal politics of the EU and UK governments. It is high time that the EU and UK join hands together to fight against the current economic crisis.
4 June 2020 at 22:51
John said…
Join hands yes, but the UK surrender its government to the EU, no. One does not need the other.
11 June 2020 at 05:38
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